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BRAZILIAN CLEARING AND DEPOSITORY CORPORATION
CBLC
CBLC
CLEARING AND SETTLEMENT SERVICES
October 8, 2007
Financial volume – Until July Financial volume – After July
Number of settled trades – Until July
0
50
100
150
200
250
300
350
400
450
2004 2005 2006 2007*
Qu
anti
ty -
Nº
(mill
ion
)
0
2
4
6
8
10
12
14
16
18
20
CBLC IN NUMBERS
CBLC
$ 91$ 121
$ 188
$ 336
$ 118
$ 159
$ 232
Vo
lum
e -
US
D (
bill
ion
)
* Until July 2007
18.93
12.07
8.58
7.75
Evolution of Securities Settlement Transactions - (USD billion)
Obs.: Exchange rate from July 31st
CBLC
CBLC CLEARING AND SETTLEMENT SERVICES
Novation
Clearing ServicesRisk Management
Services
Settlement Services
CSD Settlement Central Bank Money Settlement
CBLC
CBLC CLEARING AND SETTLEMENT SERVICES
Novation
Clearing Services Risk Management Services
Settlement Services
CSD Settlement Central Bank Money Settlement
EquitiesEquities Derivatives
Derivatives
Fixed IncomeFixed Income
Real TimeReal Time
Trade matching and confirmation are automated. The trades are locked in
for settlement to CBLC.
Trade matching and confirmation are automated. The trades are locked in
for settlement to CBLC.
STP – STRAIGHT TRHOUGH PROCESSING
CBLC
CLEARANCE & SETTLEMENT SERVICES
CBLC
CBLC CLEARING AND SETTLEMENT SERVICES
Novation
Clearing ServicesRisk Management
Services
Settlement Services
CSD Settlement Central Bank Money Settlement
CBLC
CBLC… AS A CENTRAL COUNTERPARTY - CCP
Novation
Settlement Services
CSD Settlement Central Bank Money Settlement
Clearing Services Risk Management Services
CENTRAL COUNTERPARTY
Trading information is captured on a real-time basis and in a STP fashion
All trades are previously collateralized
EquitiesEquities DerivativesDerivatives Fixed IncomeFixed
IncomeSecurities Lending
Securities Lending
BOVESPA’s Trading Systems BOVESPA’s Trading Systems
STPSTP
CBLC’s Risk Management, Clearing and
Depository Services
CBLC’s Risk Management, Clearing and
Depository Services
CBLC
CBLC becames a CCP at this momentCBLC becames a CCP at this moment
RISK MANAGEMENT SERVICES
CBLC ModelCBLC Model
Participants Requirements Participants Requirements
Collateralization
Collateralization
Settlement FundSettlement Fund
Special Net Worth
Special Net Worth
Hybrid model: Collateralization and Settlement Fund
CBLC
DEALING WITH FAILURESDEALING WITH FAILURESDEALING WITH FAILURESDEALING WITH FAILURES
RISK MANAGEMENT SERVICES
PAYMENTPAYMENTDELIVERYDELIVERY
CBLC
1st: Collaterals posted by the defaulter
2nd: Settlement Fund
3rd: Special Net Worth
1st: Securities Lending
2nd: Buy-in Procedures
Evolution of the quantity and volume of delivery failures treated by BTC
CBLC
* Until July 2007
Nº of treated delivery failures Treated delivery failures - volume (R$)
Qu
an
tity
vo
lum
e (
US
D m
illi
on
)
25,968
93,751
61,254
30,883
USD 1,931
USD 1,294
USD 783
USD 453
0
10,000
20,000
30,000
40,000
50,000
60,000
70,000
80,000
90,000
100,000
2004 2005 2006 2007*
0
500
1,000
1,500
2,000
2,500
Exchange rate as of July 31st, 2007
SECURITIES LENDING SERVICES - BTC
CBLC
CBLC CLEARING AND SETTLEMENT SERVICES
Novation
Clearing ServicesRisk Management
Services
Settlement Services
CSD Settlement Central Bank Money Settlement
CBLC
CBLC… AS A SECURITIES SETTLEMENT SYSTEM - SSS
Novation
Clearing Services Risk Management Services
CSD Settlement Central Bank Money Settlement
Settlement Services
T+1T+1
CLEARANCE & SETTLEMENT SERVICES
SETTLEMENT CYCLE
Fixed IncomeFixed Income
Equities - Cash
Equities - Cash
Equities - DerivativesEquities -
Derivatives
T+3T+3
T+1T+1T+0T+0
Multilateral netting across Multilateral netting across different different markets and markets and instruments (instruments (equities, equities, derivatives and fixed income derivatives and fixed income instruments)instruments) SFI-DVP Model 3 (BIS)SFI-DVP Model 3 (BIS)
NET SETTLEMENT
CBLC
T+0T+0
CLEARANCE & SETTLEMENT SERVICES
SETTLEMENT CYCLE
Public offerings, initial Public offerings, initial public offerings, public offerings, privatizations, special services privatizations, special services and fixed and fixed income instruments income instruments SFI-DVP Model 1 (BIS)SFI-DVP Model 1 (BIS)
GROSS SETTLEMENT
EquitiesEquities
Fixed IncomeFixed Income
T+nT+n
T+0T+0
CBLC
CLEARANCE & SETTLEMENT SERVICES
CBLC’s DVP process
CBLC
Sell-side CSD Account
Sell-side Central Bank Account Buy-side CSD Account
Buy-side Central Bank Account
CBLCSettlement Account at the Central
Bank
CBLCSettlement Account at the Central
Bank
CBLCSettlement Account at the CSD
CBLCSettlement Account at the CSD
S
10 a.m.3 p.m.
3:25 p.m.
CENTRAL BANK MONEY April 2002 - New Brazilian Payment System (SPB)
Mitigation of Systemic RiskMitigation of Systemic Risk Compliance with best practices and BIS’s Compliance with best practices and BIS’s international international recommendationsrecommendations
CBLC: one of the SPB’s clearings
CBLC
RELATIONSHIP WITH CENTRAL BANK
SPBSPB
STR
Central Bank
CBLC
Account
National System Financial Network
(XML)
CBLCCBLCCBLCCBLC
CBLC
RELATIONSHIP WITH CENTRAL BANK
Bank XBank X
Central BankCentral Bank
TRANSFER NETWORK SYSTEM - STR
SPB PRINCIPLES
Real Time Gross TransfersOverdrafts not allowed
Bank YBank Y
CBLC
Settlement Account
CBLC
Settlement Account
CLEARANCE & SETTLEMENT SERVICES
TESOURO DIRETOTESOURO DIRETO Developed by Brazilian National Treasury in a partnership with CBLC Enables natural people to acquire Federal Government Bonds directly through the internet
PUBLIC OFFERING SUPPORT SERVICESPUBLIC OFFERING SUPPORT SERVICES Operational support for the IPOs Centralization of institutional and retail investors allocation process Gross Settlement Services
SPECIAL SERVICES
CBLC
PUBLIC OFFERING SUPPORT SERVICES
* Until July 2007
CBLC
0
10
20
30
40
50
60
2004 2005 2006 2007*USD 0
USD 5
USD 10
USD 15
USD 20
USD 25
US
D (
bil
lio
n)
VolumeNumber
$ 2.7$ 6.6
$ 14.4
$ 21.0
13
20
52
42
Public Offering Evolution - Quantity and Volume (USD billion)
Exchange rate as of July 31st, 2007
144 %
118 %
46 %
THANK YOU!
CBLC
(55) 11 3233-2181
RAQUEL FERRARI SILVA BEATOSettlement Services Supervisor
